Slide 1: Revenue Rebound in Products and Trade Globally
REVENUE REBOUND IN PRODUCTS AND TRADE GLOBALLY NOVEMBER 2020 TRADING STATEMENT 24 November 2020
Slide 2: Cautionary Statement Regarding Forward-Looking Statements
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS This presentation contains certain forward-looking statements with respect to the financial condition, results, operations and business of Intertek Group plc. These statements and forecasts involve risk and uncertainty because they relate to
Slide 3: Laser Focused Operational Discipline
LASER FOCUSED OPERATIONAL DISCIPLINE
Slide 4: Our Global TQA Experts Supporting Our Clients 24/7
OUR GLOBAL TQA EXPERTS SUPPORTING OUR CLIENTS 24/7 OUR CUSTOMER PROMISE Total Quality Assurance expertise, delivered consistently with precision, pace and passion, enabling our customers to power ahead safely INDUSTRY-LEADING EXPERTISE ǀ CUSTOMER-CENTRIC ǀ INNOVATION-LED 4
Slide 5: Improved Mobility Driving Global Economy Rebound
IMPROVED MOBILITY* DRIVING GLOBAL ECONOMY REBOUND Global Greater China Asia Pacific 0% - - - (6%) (9%) (7%) (4%) (2%) (20%) (20%) (12%) (11%) (15%) (10%) (13%) (20%) (14%) (14%) (16%) (19%) (21%) (17%) (17%) (22%) (18%) (19%) (18%) (17%) (40%) (40%) (40%) (34%) (34%) (60%) (48%) (60%) (60%) (45%) (8
Slide 6: Q3 Corporate Results Show QoQ Revenue Rebound
Q3 CORPORATE RESULTS SHOW QoQ REVENUE REBOUND Revenue Q1 YoY Q2 YoY Q3 YoY Q3 QoQ 9.3% (0.8%) (6.7%) (1.4%) All Sectors Sector Communication Consumer Consumer Energy Healthcare Industrials IT Materials Real estate Utilities services discretionary staples Q3 change Communication Consumer Information
Slide 7: Supporting Our Clients to Resume Their Operations
SUPPORTING OUR CLIENTS TO RESUME THEIR OPERATIONS INTERTEK ATIC INNOVATIONS Insert Footer Here 7 1 0
Slide 8: Revenue Rebound in Products and Trade Globally
REVENUE REBOUND IN PRODUCTS AND TRADE GLOBALLY LfL year-on-year revenue growth(1) % of Group earnings(2) May-June 2020 July-Oct 2020 Group 100% (13.4%) (6.3%) Products 81% (12.4%) (4.0%) Trade 12% (18.1%) (10.1%) Resources 7% (10.7%) (9.6%) 8 Note: (1) At constant rates; (2) OP split based on H1 2
Slide 9: Resilient Revenue Performance YTD
RESILIENT REVENUE PERFORMANCE YTD Revenue Performance 10 months – January to October 4 months – July to October 2020 2019 Change at Change at 2020 2019 Change at Change at £m £m actual constant £m £m actual constant Revenue 2,271.6 2,487.5 (8.7%) (7.2%) 941.0 1,044.9 (9.9%) (6.2%) Group Like-for-lik
Slide 10: Sequential Margin Progress in H2
SEQUENTIAL MARGIN PROGRESS IN H2 • Disciplined margin performance management • Weekly, monthly and quarterly performance 5x5 margin metrics management cadence Price, Volume, Mix • Site Country and Business Line benchmarking Direct costs • Leading and lagging indicators • Continuous improvement Overh
Slide 11: Disciplined Cash Management
DISCIPLINED CASH MANAGEMENT • Disciplined cash performance management 5x5 cash metrics • Capex review to delay those investments not time critical, reducing planned 2020 expenditure by a Working capital third • Voluntary salary-deferral scheme for DSO / DPO management, running from March to October
Slide 12: On Track to Deliver a FY 2020 Resilient Financial Performance
ON TRACK TO DELIVER A FY 2020 RESILIENT FINANCIAL PERFORMANCE • Mid-single digit LFL revenue decline at constant rates • Mid-single digit LFL revenue decline in Products • High single digit LFL revenue decline in Trade • Mid-single digit LFL revenue decline in Resources • Group margin reduction at c
Slide 13: Improved Revenue Momentum in Products
IMPROVED REVENUE MOMENTUM IN PRODUCTS Jan-Apr LfL Revenue (£m) May-Jun LfL Revenue (£m) Jul-Oct LfL Revenue (£m) YTD LfL Revenue (£m) 549 517 632 317 588 1,498 1,385 280 2019 2020 2019 2020 2019 2020 2019 2020 (6.6%) CCR (12.4%) CCR (4.0%) CCR (6.8%) CCR HY20 LfL Growth Drivers Jul-Oct LfL Oct YTD L
Slide 14: Improved Revenue Momentum in Products
IMPROVED REVENUE MOMENTUM IN PRODUCTS HY20 LfL Growth Drivers Jul-Oct LfL Oct YTD LfL Increased focus of ISO Increased consumer and Business High‐single‐digit corporations on supply chain standards government focus on ethical Stable growth Mid‐single‐digit Assurance negative negative and risk manage
Slide 15: Improved Revenue Momentum in Trade
IMPROVED REVENUE MOMENTUM IN TRADE Jan-Apr LfL Revenue (£m) May-Jun LfL Revenue (£m) Jul-Oct LfL Revenue (£m) YTD LfL Revenue (£m) 216 117 233 566 200 198 492 94 2019 2020 2019 2020 2019 2020 2019 2020 (5.9%) CCR (18.1%) CCR (10.1%) CCR (10.2%) CCR HY20 LfL Growth Drivers Jul-Oct LfL Oct YTD LfL Hig
Slide 16: Challenging Trading Conditions in Resources
CHALLENGING TRADING CONDITIONS IN RESOURCES Jan-Apr LfL Revenue (£m) May-Jun LfL Revenue (£m) Jul-Oct LfL Revenue (£m) YTD LfL Revenue (£m) 159 161 84 178 421 74 154 389 2019 2020 2019 2020 2019 2020 2019 2020 2.4% CCR (10.7%) CCR (9.6%) CCR (5.2%) CCR HY20 LfL Growth Drivers Jul-Oct LfL Oct YTD LfL
Slide 17: Operational Focus Unchanged Moving Forward
OPERATIONAL FOCUS UNCHANGED MOVING FORWARD Employee Superior Purpose Margin Cash Health and Customer Driven Safety Service Discipline Discipline Engagement 17
Slide 18: Mission Critical ATIC Solutions Making the World Ever Better
MISSION CRITICAL ATIC SOLUTIONS MAKING THE WORLD EVER BETTER TESTING, INSPECTION & CERTIFICATION PROVIDES QUALITY, SAFETY & SUSTAINABILITY CONTROLS • Enabling our customers to identify and mitigate intrinsic risk in their SUPPLY PRODUCTION DISTRIBUTION RETAIL operations, their supply and TIER 3 TIER
Slide 19: Build Back Ever Better TQA Growth Opportunities
* “BUILD BACK EVER BETTER” TQA GROWTH OPPORTUNITIES SAFER SUPPLY BETTER PERSONAL SAFETY • Increased supply resilience • Higher health, safety, well-being • Faster access to critical supplies BUILD BACK standards everywhere • Increased regulation EVER BETTER • Mainstream usage of masks • Increased in
Slide 20: Greater TQA Growth Drivers Moving Forward
* GREATER TQA GROWTH DRIVERS MOVING FORWARD PRODUCTS ATIC TRADE ATIC RESOURCES ATIC 60% OFREVENUE 22% OFREVENUE 18% OFREVENUE 81% OFPROFIT 12% OFPROFIT 7% OFPROFIT GDP+ GDP GROWTH LONG-TERM GROWTH Growth in Brands, Faster Population Growth Population Growth Investment in E&P, GDP growth SKUs & e-Com
Slide 21: Capitalising on Our Fundamental Strengths
CAPITALISING ON OUR FUNDAMENTAL STRENGTHS Untapped Potential TQA SUPERIOR POWERFUL HIGH QUALITY PASSIONATE EVER BETTER CUSTOMER PORTFOLIO COMPOUNDER CUSTOMER- PERFORMANCE SERVICE EARNINGS MODEL CENTRIC MANAGEMENT ORGANISATION • Global network of • Leadership • GDP + like-for-like • Site-BL-Country-
Slide 22: Well Positioned to Deliver Sustained Value for All Stakeholders
WELL POSITIONED TO DELIVER SUSTAINED VALUE FOR ALL STAKEHOLDERS • Industry leader in an attractive $250bn ATIC market with increased needs for quality assurance • Scale positions in end-markets and 100+ countries with a unique Total Quality Assurance proposition offering superior customer service •
Slide 23: Key Takeaways
3 KEY TAKEAWAYS • ATIC REBOUND • HIGH QUALITY AND CASH GENERATIVE EARNINGS MODEL • STRONGLY POSITIONED FOR GROWTH
Slide 24: Intertek
intertek Total Quality. Assured.